EUR\/USD moved higher on Friday as the US Dollar weakened, trading near 1.1742 and close to the week\u2019s top at 1.1755. USD\/JPY fell almost 200 pips within seconds in early European trading, after an alleged Japanese intervention during Labour Day conditions.<\/p>\n
The wider Dollar drop lifted EUR\/USD from Thursday\u2019s low at 1.1655. The pair recovered on Thursday after Eurozone inflation data outweighed weaker GDP figures, and the ECB left rates unchanged while pointing to a possible near-term rise.<\/p>\n
Bundesbank president Joachim Nagel said the baseline outlook implies tighter policy and noted a possible rate rise in June. In the Middle East, the Strait of Hormuz is in its third month of blockade, with the US and Iran still exchanging threats and no stated plan to reopen it.<\/p>\n
Oil remained above $100, with Brent at $113.94 at the time of writing, which may pressure Eurozone importers over time. Technically, EUR\/USD has stayed in a roughly 100-pip band, with support above 1.1650 and resistance below 1.1750.<\/p>\n
On the 4-hour chart, RSI is near 60 and MACD shows a widening green histogram. A break above 1.1755 could open 1.1790 and then 1.1850, while weakness below 1.1645 may target 1.1580 and 1.1500.<\/p>\n
Looking back at this time in 2025, we saw the EUR\/USD pair struggling to break the 1.1755 resistance level. The market was being driven by hints of a European Central Bank (ECB) rate hike and surprise interventions from Japan that weakened the dollar. This created a tense, tight trading range.<\/p>\n
A year later, the situation has evolved significantly, as the ECB followed through on its hawkish stance with several rate hikes in late 2025. The EUR\/USD is now trading substantially higher, near 1.2020, having broken out of that old range. The ECB’s main deposit rate, which was being held steady back then, now stands at 3.75%.<\/p>\n
The geopolitical pressures from the Middle East have also eased, providing relief for the Eurozone economy. We have seen oil prices fall from over $113 per barrel during the Strait of Hormuz blockade in 2025 to a more manageable $85 today. Eurozone inflation has responded, dropping from a peak of 5.5% last year to the latest reading of 3.1%.<\/p>\n
This environment suggests the strong upward momentum in the Euro may be slowing, as much of the good news is already priced in. With the US Federal Reserve rate at 4.50%, the interest rate advantage still lies with the dollar, likely capping further sharp gains. Therefore, selling out-of-the-money call options on EUR\/USD above 1.2150 could be a prudent strategy to collect premium.<\/p>\n
Implied volatility in the pair has decreased from the highs we saw during the 2025 rate hike cycle. This makes buying protective puts a relatively cheaper way to hedge long positions against any sudden dovish shift from the ECB. Any rallies toward the year’s highs could present good opportunities to purchase this type of insurance.<\/p>\n
Given that major central banks now appear to be on hold, we can expect the pair to enter a new, higher-level range. Options strategies that profit from this stability, such as selling short-dated strangles, could be effective. Traders should watch for breaks of the current technical levels rather than expecting a continuation of last year’s strong trend.<\/p>\n
Create your live VT Markets account<\/a>\u00a0and\u00a0start trading<\/a>\u00a0now. <\/b><\/p>\n","protected":false},"excerpt":{"rendered":" EUR\/USD rose near 1.1742 as dollar weakened; yen plunged on alleged intervention; ECB signals hikes, oil risks.<\/p>\n","protected":false},"author":38,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[46],"tags":[],"class_list":["post-46389","post","type-post","status-publish","format-standard","hentry","category-live-updates"],"acf":[],"aioseo_notices":[],"featured_image_src":null,"featured_image_src_square":null,"author_info":{"display_name":"josephine","author_link":"https:\/\/www.vtmarketsglobal.com\/en\/author\/josephine\/"},"_links":{"self":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts\/46389","targetHints":{"allow":["GET","POST","PUT","PATCH","DELETE"]}}],"collection":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/users\/38"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/comments?post=46389"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts\/46389\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/media?parent=46389"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/categories?post=46389"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/tags?post=46389"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}